Head-to-head: Zipcar vs. Hertz

Alternatives to traditional car rentals are increasingly available, but how good are they?

If you live in one of 30 major metro areas—especially New York or San Francisco—you might be tempted to help an innovative upstart such as Zipcar do battle with rental-car giants. But is it easier to rent a Zipcar than a traditional rental car? Is the quality as good? Can you save money on the car rental?

To find out, we pitted Zipcar (which was acquired by Avis Budget Group in 2013) against the traditional rental service from Hertz, the largest car-rental brand. Hertz also offers its own Zipcar copycat, Hertz 24/7, but we wanted to compare the newer model (Zipcar) with the veteran (Hertz).

Quick-take scorecard

The greater the number of rental car locations, the more likely one will be convenient to where you need to pick up and drop off the vehicle. Consumers rent vehicles at airport locations for vacation travel and at non-airport locations for non-airline leisure travel, to temporarily take the place of one’s primary vehicle when it’s in the shop for maintenance and repairs or to fix insured collision damage, and periodic personal travel needs by non car owners. Hassle-free pickup and drop-off also make for smooth renting.

Hertz won hands down with 790 U.S. airport locations, compared with just 32 for Zipcar. It also has 2,785 non-airport locations, compared with Zipcar's 1,237, which is our estimate, by our count of Zipcar neighborhoods on their online maps. Zipcar locations are different than traditional Hertz locations. There are no buildings, counter agents, or parking lots with Zipcar; rather, Zipcars are parked in designated two-car parking spaces that the company calls “pods,” which may be scattered over several locations in the same neighborhood. The Zipcar that we rented, for example, was based at a public parking lot of the Bay Area Rapid Transit in Berkeley, Calif. We count multiple pods in a neighborhood as one location.

Both services were equally convenient to the home of our San Francisco-area expert reviewer when he rented vehicles from each. When it came to the pickup process, Zipcar had a slight edge, with its clever use of a transponder membership card which, when placed over an electronic reader behind the upper driver’s side windshield, unlocks the car so you can get the keys, which are inside the vehicle. (See photo above.) Very easy. That also eliminates the need for a counter agent to hand you keys or register your pickup; you book the rental online. But the car had to be thoroughly examined and photographed inside out and all around with a cell phone camera, and when I found a scratch, I had to email a photo of it to Zipcar. Drop-off involved photographing the car all around again, leaving the keys inside, locking the vehicle with the Zipcard transponder, and walking away.

Hertz is slightly less convenient, because you must present your driver’s license and credit card, sign forms, be pestered to buy the costly loss-damage waiver, and maybe wait in line to be served. The car also had to be thoroughly examined and photographed inside out and all around, but when numerous scratches and dents were found, the agent marked them on a paper form. The keys were handed to me and I drove off. Drop-off involved photographing the car all around, returning the keys, and walking away.

Rental cars are something of a commodity, which makes shopping for the lowest possible price important for consumers. Rates vary by vehicle model, location, date, and time of rental, so we made a snapshot comparison to determine the relative cost of pricing the same vehicle model for both Zipcar and Hertz, with pickup at nearby locations on the same date and time.

Zipcar did well in our cost comparison, based on our pricing of a sample Toyota Corolla for 1.5 hours. Including tax, the cost came to $19 for Zipcar, compared with $36, the daily rate, at Hertz. But Zipcar quickly got expensive the longer the rental time. For a one-day rental, Zipcar’s rate came to $97, though you can get a rate as low as $69 for other models, vs. $36 for Hertz. For a week, the Zipcar rental climbed to a deal-breaking $636 compared to Hertz’ more reasonable $182.

Yes, Zipcar pays for the gasoline, but even at California’s pricey $4.14 per gallon at the time of our comparison, that hardly puts a dent in the high cost of a weeklong rental. More costs: To rent a Zipcar, you have to become a member and pay a fee $6 per month to $60 a year, plus an application fee of $25.

The cars we rented from both agencies were clean and performed well. We found only one minor scratch on the Zipcar, but the Hertz vehicle had some dents, scratches, and sizable scrapes on the passenger side. Hertz did offer us an undamaged car, but we didn’t like that model, and the scratches and dents were listed on the pre-rental vehicle inspection form and thus posed no problem, but we were a little surprised that Hertz rented damaged cars at all, given that customers are charged for damage done while they’ve got the car.

Zipcar promises “comprehensive insurance” that was not as comprehensive as we would have liked. For example, drivers younger than 21 get only the state minimum liability coverage. So in some big states, such as California, Zipcar provides only $15,000 for bodily injury per person, $30,000 for bodily injury per accident, and $5,000 for property damage. Drivers 21 and older get $300,000 in overall liability coverage, which is below our recommendation of $400,000. There is no uninsured/underinsured driver protection.

Hertz typically does not provide free liability coverage, but it’s optional liability insurance supplement and uninsured/underinsured motorist protections provide $1 million in coverage for extra daily fees.

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